Extrinsic Rewards Are the Best Motivation to Drive Performance
Extrinsic rewards are the best motivation to drive performance
Introduction
With global competition increasing by the day, finding the key ingredients that will give an organisation an advantage that will lead to success is vital. It is widely accepted and supported heavily be research that a motivated workforce will lead to better organisational performance.
The purpose of this paper is to analyse the drivers of motivation in reference to organisational performance. Specifically the analysis will look at financial or extrinsic rewards and the impact they make to overall employee motivation.
Wage incentives have been used to motivate employees since before preindustrial times, with the theory that a financial reward (including commissions, bonuses etc.) is liked to motivation and overall performance, with fair pay driving employees to accept task and unfair pay acting as a strong de-motivator. The overall effectiveness of financial reward has been largely debated, we will review both sides.
Benefits of Extrinsic Rewards and how they drive motivation the definition extrinsic motivation (http://en.wikipedia.org/wiki/Motivation) comes from outside of the individual. Common extrinsic motivations are rewards like money and grades, coercion and threat of punishment. In this paper we will be focusing on pay and incentives such as bonus as extrinsic reward motivators.
An individual’s wage is arguably the most important component on an employment relationship for both the employee and the organisation. This is because from an organisation point of view it represents a large expense and is used to compete in obtaining the best available skilled labour to impact the overall success of the business. And for an employee, it provides a standard of living and is an indication of the employee’s importance and/ or performance.
Further extrinsic rewards such as cash bonuses, oversee trips and expense accounts can motivate employees to drive themselves to better performance
Introduction
With global competition increasing by the day, finding the key ingredients that will give an organisation an advantage that will lead to success is vital. It is widely accepted and supported heavily be research that a motivated workforce will lead to better organisational performance.
The purpose of this paper is to analyse the drivers of motivation in reference to organisational performance. Specifically the analysis will look at financial or extrinsic rewards and the impact they make to overall employee motivation.
Wage incentives have been used to motivate employees since before preindustrial times, with the theory that a financial reward (including commissions, bonuses etc.) is liked to motivation and overall performance, with fair pay driving employees to accept task and unfair pay acting as a strong de-motivator. The overall effectiveness of financial reward has been largely debated, we will review both sides.
Benefits of Extrinsic Rewards and how they drive motivation the definition extrinsic motivation (http://en.wikipedia.org/wiki/Motivation) comes from outside of the individual. Common extrinsic motivations are rewards like money and grades, coercion and threat of punishment. In this paper we will be focusing on pay and incentives such as bonus as extrinsic reward motivators.
An individual’s wage is arguably the most important component on an employment relationship for both the employee and the organisation. This is because from an organisation point of view it represents a large expense and is used to compete in obtaining the best available skilled labour to impact the overall success of the business. And for an employee, it provides a standard of living and is an indication of the employee’s importance and/ or performance.
Further extrinsic rewards such as cash bonuses, oversee trips and expense accounts can motivate employees to drive themselves to better performance
References: J. Richard Hackman Yale University and Greg R. Oldham University of Illinois, (1976) Motivation through the Design of Work: Test of a Theory, Organizational Behaviour and Human Performance 16, 250-279. Rupp, A. D. & Smith, W. T. 2003, ‘An examination of emerging strategy and sales performance: motivation, chaotic change and organizational structure’, Marketing Intelligence & Planning, vol. 21, no. 3, pp. 156-167 C.M DECI, E. (1975) Intrinsic Motivation (New York: Plenum Press) K Berrett-Koehler, 2009, The self-management process is described in more detail in Kenneth Thomas, Intrinsic Motivation at Work, Websites Title and reference of article J. Richard Hackman Yale University and Greg R. Oldham University of Illinois, (1976) Motivation through the Design of Work: Test of a Theory, Organizational Behavior And Human Performance 16, 250-279.